In spite of witnessing a sudden boom in the adoption of tech-enabled services in promising numbers post demonetisation, SBI chairperson Arundhati Bhattacharya chose to go with a cautiously optimistic stance at the Wharton India Economic Forum 2017 that was held in Mumbai.
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Discussing on the paradoxes in he cashless goals in future, she was quoted saying;
“Whether demonetisation came prematurely, only history will tell. While it has indeed given a huge push to the digital economy, I don’t really believe that India can be a cashless society. I always say that we will be a “less-cash” economy – that is a more reasonable goal to work”.
“Transactions will become less costly, but only over a period of time. But it is valid that until that happens, people will question why they should switch to digital if it costs them money, and that will elongate the transition,” she explains.
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Although 75 percent of the total population is under 25, which is the generation most accepting of newer technologies according to Arundhati, there is still a larger side of the graph believes in the human touch, and in standing in queues.
She also mentioned about the accessibility to services remains as big a gap. Considering the level of digital awareness in rural areas, if we try to push the digital economy too fast, too quickly, the abuses will then also become prevalent, according to Arundhati.
“In India, there are wide disparities. Focusing on increasing the internet’s bandwidth and speed under the pretext that it will boost GDP is not really enough when both its penetration is low and its distribution is unfair. We have just gone through demonetisation, and we have just seen that the very things that were meant to empower India could also be used for subverting a process,” she opines.
According to her, digitisation also significantly disconnects the place of business from the place of consumption. Consequently, it becomes increasingly difficult to fix the location of the value created by this economy and to apply the rules of tax so that these can be properly brought under the revenue net. She was quted saying;
“Unless this is ascertained, implemented and perfected, our country will face revenue loss, impacting its growth and position”.
Concerned about the technological revolution which will effectively, take away jobs from people. minimising human intervention she concluded with a question;
“How do the virtual and physical economies interact? What are the positives and negatives that emerge from this interaction, and finally, how do we measure the contribution of this digital economy? Is GDP, as a measure, suited to measure this new economic phenomenon?”